Today 11/06/2015, Microsoft is STILL selling OneDrive as a way to back up your files.
Well, there is no arguing with that discovery. The notion that we'd "back up" something in order to synchronize it across devices is completely foreign to anybody who went to a computer science class, but there you go. I completely agree with your conclusion, which is that MS really should stop using the word "back up" if that is not what they intend the service to do.
"Keep ALL your files" certainly does imply backup.
No, it doesn't imply that at all. I really don't understand why you or any of the other smart people on these forums would think that. I
keep all my files on my hard drive. Does that mean they are backed up? No. It doesn't.
Backup implies archival! It's dead data that just sits there, which is typically compressed, labelled, dated, and has some way of proving its validity and that it wasn't tampered with. A backup service usually also offers some sort of password protection, and usually has specific features for data restoration and the ability to compare backups/snapshots.
IMHO the fact that OneDrive supports
none of the above, or any other single feature that would be typical of a modern backup solution, makes it glaringly obvious that OneDrive is not actually intended to be anything of the sort. Any IT administrator would laugh at the notion of OneDrive being a backup solution, as it provides nothing specific to that task beyond storage space.
On the other hand, looking at what OneDrive actually can do, I'd say it's quite clear that it is most suited to dealing with live data that you're currently working on and which you'd want to access from different devices.
Is it not obvious that OneDrive is actually focused on bringing W10 devices into the mobile age, rather than being a 1980's grade backup solution?
And again... "keep all your files in OneDrive" is not semantically identical to "use me as a backup service".
I'm somewhat flabbergasted that this is even controversial. It really shouldn't be.